Speech recognition comes of age to give offshoring a run for its money

Speech recognition technology combined with a self-service element could help stem the flow of UK call centre activity heading overseas, according to Datamonitor.

A while ago, the analyst predicted that speech-enabled self-service technology would compete with offshore contact center customer service agents.

Following news that Lloyds TSB will no longer direct customer service calls to Mumbai, thanks to the introduction of an automated service, it looks like Datamonitor's prophecy has come true.

Speech recognition was once viewed as a futuristic, science fiction-esque technology, according to Datamonitor. But advancements in technology combined with increased CPU performance and lower hardware costs means that speech recognition is now commercially viable for organisations.

A contact centre in an offshore location, such as India, can reduce business overheads by up to 35 per cent per transaction, according to Datamonitor.

In contrast, however, a call dealt with using speech automation costs approximately 15 per cent to 25 per cent of the cost of a call handled by an agent in India.

And, if the savings estimated by the analyst ring true, it won't be long before other UK players follow suit and realise that they can reduce costs and keep customers happy by ensuring calls are still dealt with locally.

"As we roll out the tape over the next several years, cost pressures and globalisation will undoubtedly continue to create strong tailwinds for offshoring, said Daniel Hong, lead analyst of voice business research at Datamonitor.

"However, speech self-service will also proliferate and in many instances compete with offshoring as companies scramble to assemble the optimal blend of automation and agents for customer care."

But Hong also exercised caution in hailing speech recognition as a panacea for offshoring, instead he acknowledged that it won't be the right model for everyone.

"It is important to note that increased reliance on speech will not supplant the need for offshore contact centres for a lot of companies, rather the technology will serve as an adjunct to offshore operations as these companies look to improve customer interaction in a cost effective manner," he said.

Maggie Holland

Maggie has been a journalist since 1999, starting her career as an editorial assistant on then-weekly magazine Computing, before working her way up to senior reporter level. In 2006, just weeks before ITPro was launched, Maggie joined Dennis Publishing as a reporter. Having worked her way up to editor of ITPro, she was appointed group editor of CloudPro and ITPro in April 2012. She became the editorial director and took responsibility for ChannelPro, in 2016.

Her areas of particular interest, aside from cloud, include management and C-level issues, the business value of technology, green and environmental issues and careers to name but a few.